The initial steps taken by the Stafford Government to punish the East Coast, Poverty Bay and Wairoa tribes—sections of which had gone into open rebellion in 1865—by confiscating some of their lands led to a muddle which, for several years, caused grave unrest, especially in Poverty Bay, among the loyal natives as well as among those who had been disaffected.

Under the East Coast Lands Titles Investigation Act, 1866, the Crown planned to take over the land interests of those natives who had revolted. Mr. Stafford told Parliament that it had been arranged with the loyal chiefs that portions of the lands so taken should be given to the friendly natives who had fought against the rebels, and that military settlers should be planted in certain districts. However, the enactment failed to specify clearly the class of persons intended to be adversely affected, and, consequently, when Judge Monro visited Poverty Bay in July, 1867, no business could be transacted by his court.

The measure was rectified in 1867, but, as Major Biggs considered that it might take many years to separate the land interests of the disloyalists from those of the loyalists, Mr. McLean (early in 1868) suggested to the loyal chiefs that blocks of land in Poverty Bay, and others on the East Coast and in the Wairoa district, should be handed over to the Crown voluntarily, as representing the land to be given up by those tribesmen who had been in rebellion, and that, in turn, the Crown should waive its claim to rebel interests outside the blocks so ceded. This proposal was under consideration when Judge F. E. Maning (author of Old New Zealand) visited Poverty Bay in March, 1868, and he merely opened his court and adjourned it.

Without undue delay, the Wairoa chiefs handed over to the Crown a substantial area at Marumaru, and it was converted into a military settlement. In October, 1868, Major Biggs told the Ngati-Porou that the area which they had offered was too small. The matter was in abeyance when the Poverty Bay massacre took place in the following month. No definite offer had been made by the Poverty Bay chiefs, but they now appealed for a greater measure of protection. On its part, the Government was anxious to keep its promise to members of the Hawke's Bay page 306 Defence Corps who had fought in the East Coast War that it would find lands upon which to settle them.

Towards the close of 1868, the Hon. J. C. Richmond arranged with the loyal chiefs of T'Aitanga-a-Mahaki, Rongowhakaata and Ngaitahupo to cede the whole of their tribal lands to the Crown upon condition that those portions which were found by the Native Land Court to be the property of friendly natives would be returned. The deed of cession (Maori Deeds and Purchases: North Island, Vol. 1, Auckland, H. Hanson Turton) was signed by Henare Ruru and 278 others on 18 December, 1868.

When the Poverty Bay Crown Grants Commission sat at Gisborne on 30 June, 1869, Mr. Atkinson (for the Crown) intimated that he had succeeded in effecting a fresh arrangement with W. A. Graham, who represented the natives. It provided that Muhunga (Ormond), Patutahi and Te Arai (or Papatohetohe) should be given up to the Crown in full satisfaction of all claims against the Poverty Bay natives and that, in return, the Crown would waive all its rights over the remainder of the ceded area. It was stated (minute book, p. 2) that Muhunga comprised 5,000 acres. Mr. Graham pointed out the boundaries of Patutahi to the natives present with the aid of a plan [probably the Deed of Cession plan held in the Deeds Office at Gisborne], which showed its area as “57,000 acres more or less.” Te Arai was of 735 acres.

On 9 August, 1869, Mr. McLean met the chiefs of Ngati-Kahungunu and Ngati-Porou, and it was decided that the ceded blocks should be divided into three portions: one for the loyal Ngati-Porou, another for the loyal Ngati-Kahungunu, and the third for the Crown. It was also agreed that the European soldier settlers should receive their land at Muhunga, that the Ngati-Porou should get theirs out of Patutahi, and that Ngati-Kahungunu should be provided for out of the Te Arai lands.

The matter was again raised when Mr. McLean visited Port Awanui on 28 November, 1872. Ngati-Porou were resentful on account of a rumour that Ngati-Kahungunu were to receive portion of Patutahi; they put in a claim to the whole of that block. Mr. McLean (vide Hawke's Bay Herald) told them that it had already been decided that the ceded land should be divided into three distinct pieces—one-third to be retained by the Government and the other two-thirds to be given to the natives who had remained faithful to the Queen. Five thousand acres had been appropriated by the Government at Te Muhunga for a military settlement, and now 10,000 acres would be given to Ngati-Porou. It was true that he had promised some of the Patutahi land to Ngati-Kahungunu, but Tareha and others had agreed to accept money instead.

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Two days later, at Poverty Bay (vide Standard, 7/12/1872), Wi Pere and others urged that Patutahi should be returned to the natives, seeing that the lands of some other tribes which had turned Hauhau had not been confiscated. In reply, Mr. McLean stated that the Poverty Bay natives were well aware of the arrangement under which Patutahi had been taken, and that Ngati-Porou were to receive 10,000 acres “out of the 57,000 acres which belong to the Government.” On 7/12/1872, when tenders were called for surveying Patutahi, “said to contain 57,000 acres more or less,” the natives complained that the boundaries shown on the plan were incorrect. Mr. Locke, who was sent by Mr. McLean to examine the block, reported back that the boundaries were in accordance with the plan, and that the Government was entitled to 57,000 acres. On 20 December, 1872, Mr. Locke instructed Captain Porter to point out the boundaries to O. W. L. Bousfield, who had secured the survey contract. The block was found to contain 50,746 acres. [Captain G. J. Winter began the subdivisional survey on 15 June, 1874.]